Cost-Equalization Approach to Estimate the Minimum Duration of Effect of Cell and Gene Therapies to Demonstrate Cost Savings to Payors: A Methodological Approach Using Late-Onset Pompe Disease

OBJECTIVES: Durability of effect of cell therapies and gene therapies (GTs) is a clinical value attribute and a driver of cost-offsets in chronic diseases where the standard of care (SoC) is costly. In this case study in late-onset Pompe disease (LOPD), we demonstrate cost-equalization analysis, a health economic modeling method that can be applied to the evaluation of cell and gene therapies to estimate the minimum duration of effect to yield cost-savings.

METHODS: We developed a simulation to evaluate the cost of GT to enzyme replacement therapy (ERT) in LOPD. We assumed similar efficacy and safety between comparators, and predicted survival using a published time-dependent Cox regression model based on the International Pompe Association/Erasmus MC Pompe Survey. The assumed cost of GT was $2,450,000 based on one-time GT costs in other indications, and the cost of ERT was $637,000 per year based on the average cost of avalglucosidase alfa and alglucosidase alfa. A range of GT durability thresholds were modeled, and the likelihood of cost-savings with GT was output.

RESULTS: The estimated ERT cost over a patient’s lifetime is $10.6 million. The minimum duration of effect of GT to yield cost-savings is 4.25 years.

CONCLUSIONS: Cost-equalization analysis is a simple and data-inexpensive method that can be applied to cell therapies and GTs. The advantage of modeling is the capability to project survival and time on treatment to estimate the time of cost-equalization. Information from the analysis can be used in pricing estimates or payer negotiations. LOPD was chosen for this study because it is representative of other indications with new, and potentially expensive, GTs that may displace expensive SoC treatments in the market.